Helping seniors preserve health and financial security for themselves and their loved ones.

Friday, August 29, 2014

Feds approve PA Medicaid expansion plan

The federal government has given its approval
to a revised version of Governor Corbett’s Healthy Pennsylvania plan. The
approval could mean that Medicaid health insurance coverage becomes available
to over half a million currently uninsured adults beginning January 1, 2015.

Medicaid is the main public health insurance program for
people with low income. It is the largest source of health insurance in the
United States with coverage provided to more than 66 million Americans (1 in 5).
The Medicaid program is administered by the states but most of the financing
comes from the federal government. To get the federal funds, states must comply
with federal rules.

In the past, Medicaid was not available to many low income adults.
The Affordable Care Act (ACA - commonly referred to as “Obamacare”) expanded
the Medicaid program to cover millions of previously uninsured adults. However,
a Supreme Court ruling effectively made the Medicaid expansion portion of the ACA
optional for states.

In Pennsylvania, Governor Corbett initially declined to expand
Medicaid. However, he changed his mind and earlier this year submitted his Medicaid
expansion plan, called Healthy
Pennsylvania, to the federal government for approval. After months of
negotiation, during which many aspects of the Governor’s original plan were
dropped, the state and federal governments came to agreement.

The Healthy PA PCO part is classified as a demonstration
project (under Section 1115 of the Social Security Act) with federal approval
given through December 31, 2019. The demonstration authorizes the state to
require that a portion of the new adult coverage group receive benefits through
private managed care health plans and provides authority for the charging of
premiums and the implementation of healthy behavior incentives.

Assuming the plan is implemented, Medicaid coverage will be
available for Pennsylvania adults earning below 133 percent of the federal
poverty level ($15,521 in 2014). In 2016, participating adults whose earnings are
above the federal poverty line (currently $11,670) may have to pay premiums of
up to 2 percent of household income. Healthy behaviors can reduce the cost
sharing.

According to the Associated
Press, the expansion is expected to save Pennsylvania billions of dollars
over the coming years. The federal government will pay the cost of the state’s
Medicaid expansion through 2016. The federal government’s
match rate gradually drops beginning in 2017, decreasing to 90 percent in 2020
and after.

Expanded Medicaid coverage under the Healthy PA PCO demonstration
may be particularly important to individuals who are over age 50 but not yet
eligible for Medicare. As they reach age 50-64 people become more susceptible
to health problems but private health insurance may be too expensive or difficult
to obtain. As a result many in this age group go uninsured until they are eligible for Medicare.

Some individuals are specifically excluded from coverage under the demonstration, including:

Pregnant women, with the exception that a woman who becomes pregnant while in PCO coverage may elect to stay in PCO coverage.

Individuals who are institutionalized.

Individuals who are dually eligible for Medicaid and Medicare

Individuals 65 years of age and older.

Individuals under 21 years of age.

It is unclear how the election of Tom Wolfe as Governor this
November might impact the implementation of the plan. Wolfe has proposed
following the more traditional ACA approach to expanding Medicaid.

Note: Since January of 2014 some non-Medicaid eligible individuals
have been able to purchase health insurance coverage through the ACA’s health
insurance exchange. But gaps exist and insurance through the exchange has
been unavailable or unaffordable for many lower income Pennsylvania residents. The
new Healthy PA PCO demonstration program should help fill those gaps.

Follow me on Twitter

Super Lawyers

AVVO

PAELA

About Me

I am a Pennsylvania lawyer with over 35 years experience in estate planning and elder law. I was selected by US News Best Lawyers® as its Lawyer of the Year in Elder Law for 2014 for the Harrisburg, Pennsylvania metropolitan region.
I am of counsel to Marshall, Parker and Weber, a law firm which has offices in Williamsport, Jersey Shore, Wilkes-Barre and Scranton, Pennsylvania. I am past President and a founder of PAELA (the Pennsylvania Association of Elder Law Attorneys). However, the views expressed on this site are my own and not those of PAELA or of Marshall, Parker and Weber.
Most importantly I am a husband, father and grandfather.